New Member: Military originally from New Jersey

[Stephen Davenport]

Hey everyone,

I've been lurking/checking out Biggerpockets for about 6 months now and have been just trying to soak up as much knowledge about the buy and hold technique.

I'm currently serving overseas in the military for a few years but the goal is to make it back to the states and buy a home if the situations are right wherever I get my next duty station.. live in it for the 4 or so years, and then rent it out using a PM or myself if I feel like I can handle it.

I have a decent amount of money saved up and have a few controlled(can be paid off instantly) lines of credit to keep improving my credit score.

I do have a question though.. I understand the way to go with buy and hold properties is to create an LLC to protect yourself, or at least that's what I've ready multiple times on here. If you buy a home using either an FHA loan or a VA loan can you transfer the property to the LLC or will it get hit by some type of taxes? I really have no idea and don't even know where to begin looking. Like I said I'll be living in the home for a few years building equity, I would just like to know if it would be better to buy it as an investor and put it under the LLC off the bat or could I save money by possibly transferring it later?

I'm really impressed by the knowledge/motivation on here.. this is awesome, thanks for letting me be apart of it!

-Steve

[John K.]

@Stephen Davenport

Welcome to BP I am also in the military and overseas. I do not know about you but I am ready to go back to the great country of America!

Anyways when talking about an LLC you can find tons of information on BP to the point of confusion. I am also in the same boat, and did plenty of searching just to make it worse.

Pretty much being a new investor mortgage companies are not going to lend under a new LLC. You may be lucky I hear, but it is very unlikely considering the risk and they will need a personal guarantee for collateral. That is my understanding. Also you can transfer the title to an LLC but run the risk of due on sale clause. I also hear this is not likely if you are loyal and make your payments, but it sounds like a big risk to me.

Others have mentioned getting an Umbrella policy to cover you. If you have a PM manage your property you really run little to no risk in being sued as they will more then likely be responsible.

I am new so I might be a little off on what I am trying to say so please if anyone has anything to say please add or tell me I am wrong.